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Introduction
First, a UK tax Self Assessment error or mistake as a UK contracting professional can result in you missing the HM Revenue & Customs (HMRC) tax return deadline (UK) for your contractor tax return. Therefore, what happens if you make a mistake on your tax return (UK)? When we look at Self Assessment for directors, if a contractor SA error occurs and your tax return is incorrect, HMRC may impose a fine. When your limited company contractor Self Assessment (HMRC SA) return is wrong the first time, you will also need to do this again to as there is an official requirement to correct any tax return mistakes and you may need to pay extra self assessment tax (UK). If you don’t know what to do after making a HMRC Self Assessment mistake there’s some official HMRC errors and mistakes guidance that you can follow.
Most small businesses, be they a sole trader, in a partnership, or UK contractors who are a director of a contracting limited company, have to complete a Self Assessment (UK) Income Tax Return each year. If you’re a UK contractor, Self Assessment tax is one of your contractor taxes, albeit a personal tax rather than a company tax. Therefore, it’s important when you complete your HMRC tax return you don’t make a tax return mistake. If you find you’ve made a mistake on Self Assessment return, you’ll need to ask an accountant for help or refer to HMRC errors and mistakes guidance.
In this guide, we’ll consider all of this and what happens if self assessment is wrong and how to correct this. This is an excellent read on potential HMRC Self Assessment tax return form errors and even more so if you’re completing your first time self assessment tax return (UK).
Initial thoughts
What to consider first
If you’re new to HMRC SA as a contractor limited company owner, or for any other reason, you may wonder what is a Self Assessment tax return (HMRC). What’s more, when you’re required to file an SA tax return, you could do this yourself. On the other hand, or you might consider looking for a UK Self Assessment tax return accountant near me to look after your tax affairs. However, if you complete your SA yourself, you’ll need to know how to complete a UK tax Self Assessment tax return form. More importantly, when you do this, you’ll need to ensure you do not make a HMRC personal tax return mistake or error on tax return. Basically, if you discover my Self Assessment tax return is wrong and you’ve made a Self Assessment error or mistake, you’ll need to consider how to correct this.
Requirement to file a HMRC tax return
As a UK taxpayer, if you are both:
- A director of your own company; and
- You will have a personal tax bill in the current tax year.
Individuals are required to file a UK Self Assessment (HMRC SA) Tax Return every 12 months. Limited company contractors are directors of their own company. Therefore, in most cases they will have to complete an SA tax return each year.
When you file your HMRC Self Assessment form, besides reporting your taxable income and paying the tax you owe, you may also be required to make payments on account in the future. If you have a good contractor accountant, they will help guide you through this process.
HMRC online personal tax account
It is a good idea to register online for a Government Gateway user ID and password. Nowadays, if you search for this, it redirects you to the HMRC official sign-in page. Therefore, when you access this page, you can create the sign-in details for their digital service. As part of this process, you can register for a HMRC Self Assessment account (personal tax account) with HMRC.
With this in place, you can view your tax liabilities, payments, and any due dates for each tax year. You will also have access to view any tax due and your PAYE coding notices. Therefore, you can check your latest tax code, and if there is something in here that should not be, you or your accountant can contact HMRC and ask them to correct this.
Common questions
Some tax return questions (UK) which may arise from individuals who make a tax mistake are:
- Do I need to complete a Self Assessment?
- Can HMRC make mistakes?
- Do HMRC check Self Assessments?
- Do I declare Universal Credit on Self Assessment?
- What happens if your Self Assessment is wrong?
- What if you filled in your Self Assessment tax form wrong?
- How to fill in Self Assessment?
- What happens if you make a mistake on Self Assessment?
- What if I make a mistake on my tax return?
- Can I change my Self Assessment once submitted?
- What happens if HMRC make a mistake?
- What if my accountant makes a mistake?
- How to amend Self Assessment tax return?
Therefore, in this guide we will consider the above and look at how to correct an SA error.
Self Assessment error or mistake
What to consider?
When you are required to do so, an annual task is to file a UK tax return each year. The tax year covers 6 April to the following 5 April. Moreover, you must file this with HMRC by the following 31 January after the 5 April. Therefore, for the tax year ending 5 April 2023, the due date for filing of your return and HMRC Self Assessment payment of any tax due will be 31 January 2024. Likewise, for the tax year ended 5 April 2022, the due date for filing and payment was 31 January 2023.
Sad as it is, many people always leave this until the last minute. As a result, many may find a tax return problem after the have filed the form. As a result, this is where UK Self Assessment errors can quite often occur if you do not prepare yourself. If your return is incorrect, you may also pay more tax than is due.
File and check Self Assessment tax return (UK)
The best practice is to file your HMRC tax return (SA) early each year. We advise you to check through this from start to finish once it is complete. When you do this, you can check that you have not made a Self Assessment error or mistake. As a result, you will then have peace of mind, knowing that you are fulfilling your duties correctly and on time.
Moreover, a tax return error or contractor mistakes can often arise if you do not check your return before filing this. There are some common reasons for such errors; we will show these below.
Unique Taxpayer Reference UTR
You will need to show your correct Self Assessment UTR number on your tax return. In addition, you will also need to ensure that your National Insurance number is correct. If you discover my National Insurance number is wrong or UTR is incorrect on your tax return, it will void this when you submit it.
As an individual, you will receive your NI number before you begin work in the UK. When you have been working, your NI number will also show on any previous payslips and tax documents you receive from HMRC.
Your UTR will show on last year’s tax return and any HMRC SA correspondence.
Self Assessment error or mistake (UK) -imprecise records
You must keep records of your income and any reliefs safe throughout the tax year.
To help avoid a tax return error or mistake, you should keep in a safe place the details of your:
- Salary -this is shown on form P60 or form P45 as well as your payslips.
- Dividends -from your own company and any others. Any company dividends from other companies should show on dividend vouchers they will send you.
- Benefits in kind -these will show on form P11D. Benefits will include company car benefits, medical insurance, beneficial loan, and others.
- Bank interest on personal bank accounts. This does not include ISAs.
- Pension income -state pension or personal pension(s).
- Government benefits include universal credit, employment and support allowance (ESA), and income support.
- Rental property income details -include the total of your rental income and any expenses related to this.
- Capital Gains Tax transactions and notes on whether you can claim for Entrepreneur’s Relief, where appropriate.
- Donations under Gift Aid.
- Any personal pension contributions.
- Student loan payments.
- The details regarding child benefit received -you will receive thirteen four weekly payments each year if you receive this.
- Payments into an employee share scheme.
- Investments under Venture Capital Trust schemes, such as EIS.
Various examples of a Self Assessment error or mistake
There are many examples of where you can make Self Assessment errors. If you file your return with incorrect details on it will effectively be a false Self Assessment tax return. Consequently, it will need correcting. Therefore, extra care and attention are required when you complete your tax return (SA), either yourself or via your accountant.
If you miss the filing deadline
A widespread HMRC Self Assessment mistake is missing the tax return deadline (UK), and this is quite common. It is also more likely to occur if you leave this until close to the filing deadline. Many accountants and tax experts are under pressure from some of their clients. This is because certain people will always send them their tax return information at the very last minute. When you prepare your return at the last minute, it may become apparent that you have not included some information on this or that something else is incomplete. This could lead to your inability to file your return on time.
If you are completing a Self Assessment return yourself via the HMRC website, please do not forget to save your return as you go along. After filling in all of the sections and questions within those and completing Self Assessment to the end of the process, please also ensure that the return is sent online via their website. Once the online tax return (UK) has been completed, they will confirm the receipt of this to you.
Contractor error in tax return -report your income incorrectly
Whoever will prepare your tax return, you, or your accountant, please make sure that you double-check that the figures are correct. This can be another error in Self Assessment tax return if you do not check everything and something on your return is incorrect. Basically, you will need to ensure that you include all the figures for your income and reliefs. Income is typically salary and dividends and any other income. Reliefs are payments under Gift Aid, personal pension payments, and payments under Venture Capital Trust schemes such as EIS. If you miss including any of these it will result in Self Assessment errors.
If your accountant prepares your return on your behalf, please ensure that you check that all of the details are correct before signing off.
Self Assessment error or mistake -failure to declare all your income
You must include all your taxable income on your tax return. Your income will consist of both revenue and any Capital Gains. Certain types of income that you may receive are not taxable and if you include these it will result in Self Assessment errors. These items include:
- ISAs.
- UK Government Gilts.
- Premium Bonds.
- Betting winnings.
- Lottery winnings.
Self Assessment wrong -you complete the wrong box or boxes
There are many questions on a UK tax return. Therefore, you must be very careful when you complete this so that you do not make a Self Assessment error or mistake. In most cases, a business owner will let their accountant take care of their tax return. However, if you do this yourself and complete the wrong boxes this will be another mistake in Self Assessment tax return.
Tax return wrong -you forget to include supplementary pages
Another common mistake on Self Assessment (UK) is to overlook to include tax return supplementary pages with your return. Basically, you may need to submit extra pages with your return if you have other income. Indeed, these additional pages will include:
- Interest from gilt-edged and other UK securities.
- Tax reliefs from investments in Venture Capital Trust schemes such as EIS (Enterprise Investment Scheme).
- Life insurance gains.
- Share schemes.
- Employment lump sums or any compensation payments from a previous employer.
- Stock dividends, non-qualifying distributions, and loans that you write off.
Mistake on tax return -you forget to sign and date this
You may be one of the few that still send your return in through the post by 31 October. This date is three months earlier than the online filing deadline of 31st January. If you do this, please make sure that you sign and date the declaration before you send this to HMRC. Dating it after is another tax return error that some will make when sending in a paper tax return.
Amend Self Assessment tax return
If you discover you have made an error on tax return and filed an incorrect return, you can correct this. Basically, you can amend tax return after submission (UK) by filing another tax return with the correct details.
Other considerations
HMRC guidance -Self Assessment error or mistake
If you make an error, HMRC have ways of checking certain types of income, such as employment income. Basically, if this occurs and they discover an error, they will send you a Tax Calculation to inform you what your new tax liability is.
HMRC have a page on the web which covers HMRC errors and mistakes guidance. This covers various aspects on how you can change or amend your return. Indeed, it is very useful if you find you have made a HMRC Self Assessment mistake. Therefore, you could visit this HMRC errors and mistakes guidance page, should the need arise.
Paying Self Assessment tax bill
As an SA taxpayer, you have to pay your tax bill each year. In addition, you have to pay the correct amount by the due date of 31 January, following the tax year-end. The reference to quote with your payment is your ten-digit HMRC SA UTR followed by a capital K. Obvious to state, if you quote an incorrect reference HMRC will not be able to allocate this to your account. As a result, your payment will go astray. Therefore, it is important to quote the correct reference with your online payment.
Incorrect Self Assessment penalties
HMRC will charge penalties for Self Assessment errors and if there are mistakes on tax return. This includes late or inaccurate tax returns. In addition, they also charge penalties when a taxpayer pays the tax that is due late. Therefore, it is key to make sure that you get this right.
If you cannot pay your penalties or tax liabilities, you will need to contact HMRC Self Assessment by calling them. Their usual phone number is 0300 200 3310 and the line is open from Monday to Friday between 8am and 6pm.
Overpayment relief
If you believe you have overpaid your income tax in a previous year there is a certain process to follow when you apply to HMRC for overpayment relief. This page takes you to the HMRC article that gives more detail regarding this. The overpayment relief option replaces the previous old HMRC error or mistake claim rules.
Do HMRC make mistakes?
Occasionally, HMRC will make a tax mistake too. Therefore, what to do if HMRC make an error? If you discover that there is a HMRC mistake on Self Assessment, you should contact them and advise them to correct this. Therefore, if HMRC made a mistake, you can call HMRC on 0300 200 3310 (the lines are open from Monday to Friday 8am to 6pm). Alternatively, you can write to them about any HMRC mistakes however if you choose this method, it will take them longer to resolve the issue.
If you find that you have registered for Self Assessment in error, once again you can contact them. When you call or write, you can advise them to take you out of the HMRC SA system as you are not required to complete an SA return for the year in question.
Final thoughts
Your UK Self Assessment tax return needs filing every 12 months. Indeed, a tax return error can occur if you or your accountant are not careful when you complete this. This article covers various examples of a UK Self Assessment error or mistake that may occur and explains what to do if you make an error. If your return is wrong, there is a requirement to correct this and you can do so by filing an amended return with HMRC. What’s more, you can refer to HMRC errors and mistakes guidance as mentioned earlier for further official Self Assessment advice. Finally, please make that you give your tax return detailed review before you or your accountant submit it to HMRC.
Link to Contractor Advice UK group on
